Much like a Domino effect, the Covid-19 pandemic has triggered financial and economic repercussions worldwide. The Chinese Government created an economic bounce-back plan, and the economy continued to grow this year. However, investors are cautious, and several Asian companies have seen a decline in their stocks.
Nikkei 225 gained 0.2%, while stock in Taiwan declined
The most recent marker reports show that Japan’s Nikkei 225 gained 0.2% (NIK, -0.20 %), while the South Korean KOSPI Composite tried to remain stable: with an -0.32% index. Hang Seng from Hong Kong had a 0.2% decline (HIS, -0.49%), while Singapore STI gained 0.26%. The mixed index results show that the Asian financial market might show signs of instability. Financial investors are cautious due to the pandemic and the high cost of raw materials.
Chinese factories work at a slower pace
Due to a shortage in raw materials and their high costs, Chinese factories work slower. Even so, the manufacturing index seems to recover. Recently, the Beijing Government presented a five-year plan to control the Chinese economy and powerful companies. The new soon to be introduced rules are connected with technology, education, culture, monopolies and national security activities. The plan is called The 10-point plan, and it will end in 2025.
The new regulations are causing mixed reactions on the financial market
There will be new regulations for the finance sector, especially in ‘internet finance’, big data, artificial intelligence, and it all seems to be a crackdown on technology. This plan created by the Chinese Government has already caused an increase in the financial market. Many Chinese companies have experienced a fall in their shares. Some companies suffering due to the new regulations are Nasdaq Golden Dragon China and many tutoring companies. The regulations state that tutoring institutions cannot publicly apply for financing and cannot receive foreign capital.
